Jim Angel holds a $200,000 portfolio consisting of the following stocks:

Stock                      Investment                       Beta
A                            $ 50,000                          0.95
B                              50,000                           0.80
C                              50,000                          1.00
D                              50,000                          1.20
Total                        $200,000

What is the portfolio's beta?

2) Molen Inc. has one pending issue of perpetual preferred stock with an annual dividend of $2.00 per share. If the required return on this preferred stock is 6.5%, at what price must the stock be sold?

Answer rating: 100% (QA)

To calculate the portfolios beta we need to calculate the weighted average beta of the individual st... View the full answer